House GOP divided on debt ceiling

After several days of talks with their members, House Republican leaders have not been able to identify a debt ceiling package that could pass with only GOP support, according to multiple senior aides.

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GOP leadership’s goal was to use this week to craft a package that could pass without the help of Democrats. But the party isn’t rallying around a single proposal to lift the borrowing limit. Instead of coalescing around a unified strategy, groups of rank-and-file Republicans have expressed support for at least four different options: language to encourage the construction of the Keystone XL pipeline, another provision that would change a part of Obamacare, reforms to Congress’s budgeting process and — in one of the most recent suggestions — reversing recent changes to the cost-of-living formula for the military.

Here’s why Republicans are stuck in neutral: They have a significant bloc of members who decline to vote for any debt limit increase out of principle. The rest of the conference is split between this smattering of suggestions.

Adding extraneous policy onto the debt ceiling hike is, essentially, a sweetener for Republicans who loathe the nation’s debt. Passing a bill with only Republican support serves two purposes: one strategic, one practical. It helps establish a GOP negotiating position since Democrats insist on a so-called clean debt ceiling hike. And House Democrats are unlikely to support any debt ceiling increase with policy tacked alongside, forcing Republicans to pass legislation on their own.

The divergence of opinion among Republicans is creating some drama: The debt ceiling fight might run right up to the end-of-February deadline. But defaulting on the debt isn’t really a possibility for Republicans who caused the first government shutdown in 17 years. Republican leaders know threatening default is untenable, and most Republicans have softened their price for a debt limit hike.

In a closed meeting Tuesday, Speaker John Boehner urged Republicans to get their act together so they don’t have to pass a clean debt ceiling bill from the Senate. But several senior GOP aides and lawmakers say that scenario is looking more likely. Senior Senate Democratic sources are delighting in the House Republicans’ disorganization and say that the House should move first.

There’s not much time for House Republicans to figure out their next move. The House will not vote on anything this week. Next week, the House recesses early Wednesday for the House Democratic Caucus retreat. The chamber will then remain out of session until Feb. 25. The Treasury Department has said Congress must lift the debt ceiling by the end of February — at the absolute latest.

These are situations the party wanted to avoid. Republicans have said they want to skip the cataclysmic fiscal battles this year, keep the focus on Obamacare and present alternatives to President Barack Obama’s agenda. House Majority Whip Kevin McCarthy (R-Calif.) even told colleagues in a closed meeting Tuesday that this was the last legislative hurdle in 2014.

All of this could change if the dynamics within the conference shift in the next few days, but top GOP aides say that’s doubtful.

GOP leaders believe they see one hopeful sign from sounding out the rank and file: It does not appear that any House Republicans think defaulting on the nation’s debt is a good tactical play.

Multiple legislative proposals are kicking around, as the leadership canvasses their members in phone calls, one-on-one discussions on the House floor and private meetings.

One option would be to insert language alongside a debt limit increase that would attempt to mandate the construction of the Keystone XL pipeline. So far, the Obama administration has not approved a permit to build the northern leg of the proposed pipeline from Canada, despite pressure from Republicans and Canadians.

A third option has also surfaced in recent days. Republicans have privately expressed interest in reversing recent changes to cost-of-living benefits for the military. The so-called COLA formula was tweaked in a budget agreement authored by Rep. Paul Ryan (R-Wis.) and Sen. Patty Murray (D-Wash.), but Republicans have since sought to reverse this provision.

The House Republican strategy was to attach something Democrats couldn’t refuse to the debt limit. But senior Senate Democratic aides say the items under discussion will be easy to resist. Senate Majority Leader Harry Reid (D-Nev.) and Obama have said they will not negotiate over the debt limit, so this scramble in the House might not amount to anything.

“We cannot and will not play games with the full faith and credit of our country,” Reid said Tuesday. “We can’t again have to worry about hostage takers, and that’s what they want. We’re not going to pay ransom for a bill that Republicans supported for decades. Ronald Reagan raised the debt ceiling 18 different times. The American people want the economy to grow, and our economy needs certainty. So let’s do the right thing and move on.”

Boehner wants to move on as well. He told Republicans Tuesday morning that they need to build consensus and not pick a fight that they cannot win. He told Republicans privately that he is worried the Senate will send the House a debt ceiling increase with an extension of unemployment benefits attached. Top Democrats told POLITICO that was unlikely.

“We’ll see,” Boehner said. “Listen, the goal here is to increase the debt ceiling. Nobody wants to default on our debt. But while we’re doing this, we ought to do something about either jobs and the economy, about the drivers of our debt. And so we’re talking to our members, and when we have a decision, we’ll let you know.”